In the last five years, the increase in national renewable energy\n(RE) installed capacity has recorded cumulative growth of approximately\n15.6 GW, with the primary energy mix portion ranging between 13% and\n15.7%.<\/p>\n
This achievement has been primarily supported by the\noperationalisation of large-scale projects such as the Cirata Floating\nSolar Power Plant (192 MWp), the expansion of geothermal power plant\n(PLTP) capacity, and the implementation of mandatory biofuels, reaching\nB35 and preparing for B40, with domestic biodiesel absorption exceeding\n14.9 million kL.<\/p>\n
Despite recording physical and volume increases, these achievements\nare still realistically below the targets set by the National General\nEnergy Plan (RUEN), which mandates a 23% share by 2025. This relatively\nstalled progress is caused by three fundamental factors.<\/p>\n
First, the optimisation of electricity grid infrastructure to absorb\nvariable RE currents has not yet been achieved. Second, there is a\nlong-term financial entanglement with coal-based fossil power plants.\nThird, there is a high economic disparity between RE tariffs and the\neconomic price of coal, which benefits from domestic market\nprotection.<\/p>\n
To accelerate the energy transition efficiently and sustainably,\nparticularly within the next five years as a foundation, there are four\nkey aspects that serve as the primary determinants on the ground.<\/p>\n
Aligning Fossil Contract Loads and PLN\u2019s Financial\nFlexibility<\/strong><\/p>\n The greatest obstacle to massive RE absorption\u2014especially in the\nJava-Madura-Bali (Jamali) system\u2014is the condition of overcapacity in\nelectricity supply, which is tied to long-term Take-or-Pay (ToP)\ncontracts with private Steam Power Plants (PLTU\/Independent Power\nProducers).<\/p>\n Under the ToP clause structure, PT PLN (Persero) is required to\ncontinue paying for the electricity produced by PLTU according to the\ncontract quota, regardless of whether that power is distributed to the\ngrid or not.<\/p>\n This condition creates rigid financial implications. Adding new RE\ngeneration capacity without accompanied early retirement or adjustments\nto existing PLTU contracts can technically trigger a double payment\nburden for PLN. If PLN aggressively absorbs new RE electricity, PLN must\nshut down or reduce the output of existing PLTU while still bearing the\nToP absorption penalties to private PLTU owners.<\/p>\n Therefore, accelerating RE requires a mechanism to de-risk the\nfinancial burden from PLN\u2019s balance sheet. The early cessation of PLTU\noperations or the restructuring of ToP contracts cannot be borne solely\nas PLN\u2019s operational cost.<\/p>\n Special instruments are needed, such as the reallocation of Just\nEnergy Transition Partnership (JETP) funding, multilateral funding, or\nthe establishment of a sovereign energy transition fund. These\nfacilities would serve to cover the compensation costs for terminating\nfossil contracts so that the energy substitution process does not\ndisrupt fiscal stability or the solvency of the state-owned electricity\ncompany.<\/p>\n Modernisation and Financing of Grid Infrastructure (Grid\nFirst)<\/strong><\/p>\n The characteristics of variable RE, such as solar (PLTS) and wind\n(PLTB), depend on weather conditions and time. Without balancing\ninfrastructure, large-scale penetration of variable RE can disrupt the\nstability of frequency and voltage in the national electricity grid,\npotentially triggering blackouts.<\/p>\n The construction of RE power plants must prioritise or run parallel\nto grid modernisation (grid-centric planning). There are three technical\ncomponents that are absolute requirements:<\/p>\n \u2022 Smart Grid: Automated two-way power flow control based on digital\nsensors and advanced measuring tools to monitor power fluctuations and\nregulate load balancing in real-time.<\/p>\n \u2022 Battery Energy Storage Systems (BESS): Load balancing during peak\ndemand periods (peaking management) or during drops in solar\/wind power\noutput due to weather factors.<\/p>\n \u2022 High Voltage Direct Current (HVDC) Transmission: Inter-island grid\nconnections required to distribute energy from large-scale RE potential\ncentres in areas outside Java (such as hydropower in Kalimantan\/Papua\nand geothermal in Sumatra) to industrial and urban consumption load\ncentres on Java.<\/p>\n Given the massive capital expenditure (CAPEX) for grid\ninfrastructure, which is estimated to reach tens of billions of US\ndollars, the government cannot rely solely on PLN\u2019s internal capital or\nState Capital Injections (PMN) from the state budget. The government\nneeds to open Public-Private Partnership (PPP) schemes or Independent\nTransmission Projects (ITP).<\/p>\n Through this scheme, private consortia can build HVDC or BESS\ninfrastructure using an availability payment mechanism (payment for grid\navailability by the state\/PLN), ensuring that the risk of supply\nfluctuations is not borne by grid investors.<\/p>\n Legal Certainty and Energy Market Regulatory\nReform<\/strong><\/p>\n Accelerating RE requires a legal framework at the level of an Act (UU\nEBET) capable of providing long-term investment climate certainty.\nCurrent regulations, such as Presidential Regulation No.\u00a0112 of 202\nproportion 22, provide an initial push through the Maximum Price (HPT)\nscheme, but are not yet strong enough to address cross-sector\noperational constraints. An ideal regulatory framework needs to include\nthree strategic points:<\/p>\n \u2022 Limited Power Wheeling Scheme: Opening a transparent and regular\nmechanism for renting PLN\u2019s transmission network. This rule would allow\nprivate RE producers to supply green electricity directly to industrial\nconsumers (B2B off-takers) by paying a grid toll to PLN. This mechanism\ncan accelerate installed RE capacity without burdening PLN\u2019s capital\ncosts to build its own plants.<\/p>\n \u2022 Harmonisation of Local Content (TKDN) Rules: The application of\nDomestic Component Level (TKDN) in RE projects needs to\u2026<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/key-aspects-for-accelerating-new-and-renewable-energy-development-1789725477",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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